This afternoon I met with a business owner who was interested in joining one of my Mastermind Groups. He is in the human resources industry and might be a little too early stage for my groups but he has an excellent strategy – start working on your business while you are employed by someone else. The potential member is currently holding down a full time job in his field of interest while he lays the groundwork for his own company which he has started on the side. He has a plan to go out on his own full-time in the next 12-18 months.
Here is a formula for success if you are considering starting a new business:
1) Learn & Earn – Find a job that is in the industry that you want to start a business in. This way you can learn what it takes to succeed in that market and not lose money doing so – you will actually be getting paid by your employer to learn about the industry! Make sure the job also pays enough to support your lifestyle and a little extra that you can save for when you start your own business. If your goal is to run your own business and your current job is not giving you the learning experience you are looking for, find a new job. Work for someone else to learn the ropes, not to build a career. Make sure, however, that you do not sign a non-compete agreement which prevents you from competing with your employer once you leave their firm.
2) Find Your Niche – By working for someone else in your industry you can learn what sells well and what does not. You will learn about the new trends in the market as well as who the main players are. You will also hopefully learn more about what you are passionate about and where a niche can be carved out for your own business. Get involved in as many projects as you can – especially the ones that deal face to face with the customer – so you can learn about where people are spending their money. Once you identify a niche that could be potentially profitable, begin exploring a business plan for how you can build a company of your own.
3) Find A Customer – The easiest way to succeed is to find customer with a problem and solve it for them. If you can start your business with a paying customer you will ease many of the cash crunch situations that many new business owners often find themselves in. Get a single customer whose needs you can service on a part time basis. Make the product or service easy to source and deliver. Moonlight while keeping your existing job so you can keep the cash stream coming in. If your ideal product or service requires more time or money to get going, find a way to deliver a scaled back version of it immediately. The goal is to experiment with new offerings that you can sell, bring on a few customers, and not lose your job in the process.
4) Break Away – Once you are confident that you have a product people will pay for (and already have paid for) you can break away from your job. Your chances of success are much higher because you have learned about the industry, made your mistakes on someone else’s dime, and have built your business around paying customers. Usually the decision to break away comes with a large customer order that you will be unable to fulfill unless you leave your job. This is a good problem to have and forces the move. If you are not quite ready to work for yourself full-time but want to spend more time on your business, see if you can work part-time or on a contract basis with your employer. If your product or service is a direct competitor to them then they will likely not want to keep you on but if you are in a complementary business then it is more feasible to do. If you are going to steal one of your employers customers (a great way to get going in a new business), make sure you have not signed anything that prevents you from doing so.
Evan Carmichael
